Rebuilt Engine Price Markup

[Jerry Sanders]

I just got my 91 Explorer back from the mechanic today - had a rebuilt engine put in. The price was $2387 for the engine and $562.50 to install it. I received a pamphlet from the company that rebuilt the engine - ATK engines.
Out of curiosity, I looked up their web site and called them.

I was surprised to find that I could have gotten the exact same engine delivered to my (or a mechanic's) door for $1895!

Does a nearly $500 markup for merely making a phone call to ATK seem an unreasonable fee for my mechanic to charge me for this engine?

 

[dbarale]

As a mechanic, he probably got another 15 to 25% from the company.
That means he probably made around 700$ for a phone call.
I should be a mechanic...

 

[Jerry Sanders]

I realize that shops markup the prices on parts, that's one way they make their living and I don't have a problem with that, especially if they have to go get the parts. I just think this is an unusally high markup for one item.

Is this normal? Has anyone else had a similiar experience?

 

[Robert]

It varies by industry. For instance my company manufactures flow meters. On anything we purchase and turn around and resell it gets marked up * 1.8. For things we have to make we mark our costs up by 2.8. My Wife has worked the last 7 or 8 years in the fine jewelry business. She could buy jewelry at the store she just recently left for cost + 15%. She bought a necklace that retails for $800 for less than $150. Every company has their mark-up and sometimes it doesn't seem fair. If the shop did an excellent job and will stand behind their work, sometimes it is worth a little extra. What do you think your Ford dealership did when they sold you your Explorer? Many times all they do is a few hours of paperwork and make several thousand dollars in profit for the privelage of selling you your Explorer. I would be more concerned with how well the shop performs in the unlikely event that you have a problem with the engine.

Did you inquire about having your own engine shipped to them? Even if they would have accepted, they probably wouldn't have provided any warranty on the installation. So if your engine developped a knock or other noise, it would be between you and the engine rebuilder to get it resolved. Not having those kinds of hassles is also worth something.

 

[amigo]

I agree with the quality and not the price. I recently had my heads replaced with brand new one and a couple lifters replaced. Got it all done including labor for $1250, only like $250 in labor the rest was parts. Well since then I think the mechanic caused more problems then he fixed. Shortly after the ignition stopped working, never had the problem before replacing the heads. I replaced the ignition switch, starter relay, neutral safety switch, battery cables, ignition lock and still never fixed the problem. Now it has a push button and 2 wires running to the starter relay. turn the key, push the button and it starts right up. Now 2 weeks ago the left side of the engine started knocking or I should say fluttering. Now its back to another mechanic to fix both problems caused by one. So you see my point going cheaper is not always best.

 

[914x4sport]

I used to be an HVAC Tech.. Our markup was 100-200% BEFORE labor... $350 condensor was $700+labor($300) $1000.00 out the door. Just be glad that didnt do THAT to you...

 

[jimmiecakes]

We aim for 25% markup on big ticket rebuilts. Freight swallows a huge chunk of that. We also have to carry part of any warranty claims that may arise from the the job. We also need to know who gives us "good" engines and who has motors we need to stay away from.

You didn't mention the charge for the rest of the stuff, oil, filters, coolant, block heater, etc. etc. Was this included with the engine price?

Five hundred and some bucks isn't much for the labour for a job this size. If you had supplied your own assembly, you could expect the labour rate to be much higher to compensate for the lost profit on the motor. Most of the guys I know are shying away from installing customer supplied parts - we're all branded as shylocks and customers bringing "suspect" parts doesn't help.

Now, I just gotta ask..... how come some of you guys can't seem to fid a good tech? If you're price shopping, I can tell you that "Cheap ain't".